The composite PMI for the eurozone fell to a two-month low of 52.8 this month, down from 53.8 in July. Factory output weakened, with the eurozone manufacturing PMI falling to a 13-month low of 50.8, closer to the 50-point mark that separates expansion from contraction.

Firms also reported that job creation had slowed to near-stagnation in August, suggesting that progress in cutting eurozone unemployment is stalling.....

The survey added to signs that the euro-zone’s feeble recovery is already over, increasing pressure on the ECB to do more to support the flagging economy even as other central banks start to tighten monetary policy.

But America’s factory sector appears to be growing strongly this month: the US manufacturing PMI jumped to 58.0, the highest reading since April 2010, as companies put last winter’s slowdown behind them.

In London, the FTSE 100 eked out a small gain as a lack of negative news from Eastern Europe and a string of positive updates from the US have brightened the mood; the eurozone stock markets are benefiting the most from the improved relationship with Moscow.

The unimpressive services and manufacturing data from the eurozone is fuelling speculation that the European Central Bank will loosen its monetary policy this side of Christmas.

Written before today’s economic data, it explains how policy failures and the restrictions of the single currency have made the eurozone “one of the biggest catastrophes in economic history”.

Photograph: Washington Post

Here’s a flavour:

Just like the 1930s, Europe is stuck with a fixed exchange system that doesn’t let them print, spend, or devalue their way out of a crisis. But, unlike then, Europe might never give it up. It’s a fidelity to failure that even the gold bloc couldn’t have imagined. And that leaves the ECB as Europe’s only hope—which means they’re probably doomed.

Now, to be fair, the Draghi-led ECB has done about as much as it can given its legal and political constraints. But you don’t grade unemployment on a curve. And those constraints aren’t going to go away, not enough anyway, to avoid a lost decade or two. Instead, the ECB will probably keep doing the bare minimum: some half-hearted quantitative easing that will stop as soon as Germany starts to grow faster.

Capital Economics: eurozone's feeble recovery is already over

The manufacturing index suffered the sharpest decline, from 52.7 to 50.9, suggesting that the Russia-Ukraine crisis is having a greater impact on confidence and activity than direct trade links alone might imply. In any event, the survey added to signs that the euro-zone’s feeble recovery is already over, increasing pressure on the ECB to do more to support the flagging economy even as other central banks start to tighten monetary policy.

Note that the flash estimate of the EC’s measure of consumer confidence in August was also weaker than expected.

Eurozone consumer morale hits six-month low.

In another blow to the eurozone, consumer confidence in the region has fallen to a six-month low.

The EU’s index of consumer morale fell to minus 10.0 in August, dropping from July’s minus 8.4 to the lowest level since February.

Confidence also dipped across the wider EU, from minus 5.5 to minus 6.4%.

Photograph: European Commission

The Ukraine crisis may have hit sentiment, as Russia and the West hit each other with sanctions. The weak growth figures in the second quarter of 2014 may also be a factor - with France stagnating, Germany contracting by 0.2%, and Italy falling back into recession.

Markit Economics (@MarkitEconomics)

Consumer confidence in the eurozone falls more than expected: down to -10.0 (-8.4 in July). Analysts had expected a fall to -9.0

US manufacturing PMI hits four-year high.

Just in: activity in America’s factory sector has surged at the fastest rate in over four years, outpacing Europe’s weak economy

The flash manufacturing purchasing managers index has jumped to a reading of 58.0 in August from 55.8 in July to reach the highest level since April 2010.

Firms reported a steep rise in production, and in new work, suggesting the sector enjoyed robust growth.

Here are the key points from Markit:

Manufacturing PMI rebounds sharply from July’s three-month low

Output and new orders both rise at faster rates

New export business increases at steepest pace for three years

Employment growth accelerates to strongest since March 2013

Photograph: /Markit

Markit economist Tim Moore adds:

“Overall, with job hiring gathering momentum and input buying expanding at the sharpest pace for at least seven years, it seems US manufacturers are increasingly confident that the recovery is firmly back on track and are gearing up for a sustained rebound in production schedules over the months ahead.”